BofA Beats Analyst Expectations

From analysts expectations of about $0.38 EPS, the Bank of America recently reported earnings per share of $0.40 to about $20.22 billion in revenue.

Bank of America also announced that for the first two quarters of the year, their stock-buyback program would be increased from $2.5 billion to $4.3 billion.

Despite a higher EPS, shares were unaffected as the firm released trading revenue which was below what they have originally forecasted from $3.06 billion to $2.91 billion although their revenue from banking went up from an expected revenue of $1.14 billion to $1.22 billion.

Meanwhile, their revenue from fixed income, currency, and commodities was at $1.96 billion missing expectations of $2.12 billion although their equities trading revenue was up by 7% to $948 million from what they initially expected at $943.7 million. According to Bank of America, the FICC revenue increased by 12% from the same quarter last year due to the company improving their customer flow in the middle of a challenging market.

Fourth Quarter Highlights

During the fourth quarter of 2016, Bank of America reported an increased revenue under an interest expense to $20 billion from $19.6 billion.

Meanwhile, return on average equity was at 9.99%, return on average common equity 7%, and return on average assets 0.85%.

$5.1 billion in common stocks were also repurchased by the bank while $2.6 billion worth of dividends were paid back by the company. Higher market valuations also led to higher client balances to about $2.51 trillion.

Other than the rise in their revenue, the banking business of the company performed better with an increase in their client activity despite a rise in the interest rates. The bank remains positive regarding their interest rates which will result in a rise in their net income as they continue to prioritize shareholder returns through repurchases this according to BofA chief financial officer statement Paul Donofrio.

Chief executive officer Brian Moynihan also stated in the earnings report that the bank’s strategy lead to a strong 2016 result and that they were able to drive their revenue and their earnings per share up by about 15%.

For the bank’s last quarter last year, BAC’s stock price has already jumped by 49% or 51% if you count the dividend returns. This in the middle of a revenue short of analysts expectations but still a bullish outlook.

The company’s mortgage program production also increased by 29% to $21.9 billion while the bank was able to open 31 more financial centers in the past year. Mobile banking users and activity also rose up by around 16%-19% accounting for an efficient mobile banking system for the bank’s clients.

Shares of the company are currently up, climbing from a decline during 2016's third quarter and have not shown a bearish outlook this month. It should go and continue to climb an upward trend as the Trump presidency so far has not threatened the banking sectors in the country.

After a positive performance last 2016, the bank might still have plenty of room to upgrade as the Trump administration is showing a promising effect on companies particularly banking firms as tax-cuts and other plans that Trump have campaigned over his campaign regarding his plan to focus on the growth of the economy including the idea of setting back some regulations to companies which operate fully in the United States.

Get more of our latest in-depth market news analysis and subscribe to our daily newsletter. FSM News provides you with the most recent updates and information. Subscribe now to FSMNews.

FSM News is more than an essential bookmark; it is a revolutionary media platform that presents breaking news on the market in the simplest way possible. With the fast pace developments in the finance industry, it is not easy to stay well-informed of all the key issues that drive market movements. Hence, we have created this platform to provide the most relevant market information and analysis on a daily basis.